Content: options
Related Tags: Volatility, Implied volatility, Investing, Trading, Stocks, Hedging, Spy, Vix, Risk, Option strategies, Calls, Skew, Covered, Derivatives, Stock, Call, Forecasted volatility, P , Volatility models, Equity options, Vega, Spx, Black, Gamma, Apple.
With the VIX closing near 2 year lows at 18 and the S&P 500 sitting at its 18 month high, it might seem that the clouds have parted. On the contrary, with pressure being put on China to revalue...
Equity volatility might seem to have little to do with the level or shape of interest rates, but after a bit of exploration we might be able to draw some solid conclusions.
The holy grail of derivatives trading is to predict future levels of volatility. Unlike equity prices alone, volatility has a somewhat predictive nature.
The holy grail of derivatives trading is to predict future levels of volatility. Unlike equity prices alone, volatility has a somewhat predictive nature.
Many investment newsletters and option strategy resources tout put-spreads and call-spreads as the two fundamental option strategies. In doing so, they often tell retail investors to do exactly...
If we pair a long position in the ATM short-term option, which has a very high gamma, with a short position in an out of the money long-dated option then we still end up with a net positive gamma....
Here's a good video on how to choose options to buy. I like to use options to hedge risk using covered call positions. I sometimes also sell options to generate some income. A riskier way to trade...
By examining the skew and term structure of implied volatility an investor can develop new strategies to capture higher dimensions of volatility investing.
Directional market bets can be very tricky. Many unpredictable factors can impact the performance of world equity markets which can make the “investment” process seem much more like a...
The end of the year seems to lend itself to a bit of a conspiracy theory. My focus today is on the VIX, but with the backdrop of financial statement marks at quarter-end periods. Everyone knows...
If you have read some of my articles regarding the Credit Suisse Fear Barometer or my discussions surrounding skew, then you understand why 10% out of the money puts are often more highly valued...
An investment strategy that is highly underutilized is the selling/writing of call options on individual stocks or ETF’s that are owned within an investment portfolio. I will cover three...
Up until 2008, the markets since 1990 had been relatively calm and there was a consistent option premium that has rewarded option sellers via a positive gap between option implied volatility and...